Econ 1.2 FOPs

True

False

How to produce?

What to produce?

How to consume?

For whom to produce?

To organize an economy to allocate resources efficiently and fairly

To increase the population of a country

To promote only technological advancements

To create new forms of government

Central authority controls production

Production is based on communal needs

Production decisions are made by buyers and sellers

Profit is the main motivation

Freedom of choice

Income inequality

Leads to innovation

Does not provide products/services unless profit is available

Private individuals

Central authority

Buyers and sellers

Local communities

Abolish all private property

Promote free markets

Encourage entrepreneurship

Support monarchy

It leads to misery and degradation at the opposite pole

It results in overall prosperity

It encourages innovation

It creates more jobs

North Korea

Cuba

China

France